Iberia and Vueling confirmed this morning that they have received a combined €1 billion bail-out from the Spanish Government.
Sister companies of British Airways inside the IAG umbrella, Iberia received €750 million whilst Vueling received €260 million.
These are five year soft loans. Whilst the money came from commercial banks, 70% of the loans have been guaranteed by the Spanish Government which means that the repayment risk is substantially reduced. This allows the money to be lent at a lower interest rate than would otherwise have been required.
The money is not allowed to be passed up the chain to other IAG airlines and must be used exclusively for the benefit of Iberia and Vueling. I would imagine that it cannot be used to fund the €1 billion acquisition of Air Europa, which has unsurprisingly gone very quiet in recent weeks.
You can see the full announcement on the IAG website here.
This structure is different to the one that easyJet and Hungary’s Wizz Air have used to receive bail-outs from the UK Government, which involved the Bank of England directly buying new bonds issued by the airlines. See our articles here on the easyJet £600m bail-out loan and here for the Wizz Air £300m (TBC) bail-out loan.
Didn’t British Airways say it wouldn’t access soft Government loans?
In the announcement on Tuesday, BA’s CEO Alex Cruz said that part of the reason that British Airways had decided to make 12,000 employees redundant was that it was not accepting Government money.
The letter to employees said:
There is no Government bailout standing by for BA and we cannot expect the taxpayer to offset salaries indefinitely.
Except, of course, there IS a Government bailout standing by for BA if it wants one – the same one that easyJet and Wizz Air have accessed. British Airways had investment grade commercial debt in issue on 1st March 2020 which is the key requirement.
What wasn’t clear at the time was why Iberia and Vueling had not announced redundancies. Why was British Airways cutting 25% of its staff whilst the Spanish subsidiaries were cutting no one?
Now we know. It is very likely that the terms of these Spanish Government loans including protections for employee rights.
It is quite clear that the IAG board has no problem with its subsidiaries taking soft Government bail-out loans. A cynic might suggest that the only reason that British Airways has refused to access the Covid Corporate Finance Facility is to give it cover to pursue its redundancy programme, which itself now appears to be cover for finally ridding itself of high-paid legacy cabin crew.
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About Head for Points
This is just a cynical attempt by BA to use a bad situation to remove staff on the legacy terms and conditions. They will rehire just as many in six months on the new lesser terms. So much for loyalty. The savings on pay t and c and pension costs will be huge.
Can’t they just pay pilots minimum wage – take it or lump it?
As a responsible employer BA would pay the living wage.
They could, now. Given complete collapse in demand for pilots.
However pilots would normally have earned enough to save some money so they would close to all walk away.
Up to and beyond the median salary level in the UK employees generally haven’t savings especially if they’re single or even couples. Note I said median (half way through sample size) not average.
So the vast majority of employees in this situation have nothing to fall back on and because the UK is run for the owners of capital, those employees have nothing, get nothing for losing their jobs and can’t walk away.
Some former employees of British Airways will literally die because of this.
complete speculation stated as fact.
Wow. Stunning ignorance.
One of the reasons pilots are paid more than the average wage is because it’s a skilled job and there are significant personal sacrifices to be made (the responsibility of 300 lives and a two hundred million pound aircraft, overnight flights, crap weather, birthdays / Christmas / anniversaries etc away from families, loss of sleep health impact, and the stress of putting their livelihood on the line every six months). The job is undeniably rewarding but not so much that people will do it for minimum wage.
If they could earn the same money packing boxes at Amazon then do you genuinely think they’d keep flying? No, what would happen is the most desperate person will get the job. I bet you wouldn’t be so keen to be a passenger during storm Dennis knowing that the pilot is at work because he or she is desperate for enough money to keep their house or family. Probably with a cold as well, because the absence policies are going to become incredibly punitive.
I doubt BA will even be at 50% of its November 2019 capacity in 6 months so the prospects for rehiring in the short term of anybody made redundant are slim. I feel very strongly that BA are currently using the job retention scheme and our tax payer money to push this through at minimum disruption and cost to themselves, and will very likely return with further requests for tax payer support when their dirty work is all done. I plan on contacting my MP regarding this matter tomorrow, I hope others will do the same.
So they put staff on government furlough at the start of April when demand collapsed (with massive approval from the unions at the time), and then a month later when projections of the recovery in demand suggest its going to be extremely protracted at best, they right size their business.
And in terms of doing it at minimum cost, how is that wrong in these circumstances? The directors have a responsibility to maximise the survival chances and health of the business.
Put another way, consider your personal reaction if you suddenly lost your entire income stream, and your best projection suggested you wouldn’t get it back for 18 months, yet your current lifestyle spend meant you’d burn through your cash in 6. I suggest you’d quickly stop shopping at Prada, if the alternative was being on the streets.
Exactly, even if the government said do you want a loan that you will need to repay to keep shopping (and you’ve no use for the clothes for a while)
I do feel very sad for the staff. Going to be a tough few years for the economy
@Bob, are you on a legacy contract? I’m guessing so from your 24 years service. Would you prefer to move to the Mixed Fleet contract if it was a case of remaining employed or being made redundant on statutory terms?
I understand the frustration especially as it seems that BA has so much cash but that cash won’t last forever in the same way as your £600 won’t. The difference being the sums are bigger but so are the expenses. If the cash runs out then no one at BA has a job, not just the potential 12,000. I accept that the cash may not run out but just borrowing from the government isn’t necessarily the answer either.
I wish you and all your colleagues well.
@AJA of course employees would move to Mixed Fleet sooner than take basically nothing in exchange for losing their jobs. Then anyone with any sense would take anything else as soon as they can after that if they’ve been forced by BA into losing all their legacy benefits. Unless long service still has a value.
But UK legislation is miserablly nonprotective of employees and if an employee is going to play hardball then even the meager amount you could get stops at the point of 12 years service.
Yes, let excess staff go, Mikeact. But be decent about it because this is a blip in the continuing life of BA, but is permanent damage for employees.
And find a fair basis for selection. I haven’t had amazingly motivated and competent service from Mixed Fleet most of the time whereas with legacy staff I can remember only quality experiences going back at least 20 years.
I’d try a challenge as to basis of selection for redundancy as being indirectly discriminatory which is illegal. I think BA could find enough reasons right now to make it stick anyway but worth a try
The Spanish government had the b*lls to demand this and so will the French and Dutch. The UK? why do we stay working in this stinking ship?
@Lady London, we stick with it because the populace in the UK, unlike the French for example, no longer have the b*lls for a fight. There are two reasons for this. Firstly, Mrs T turned us into a ‘home-owning’ nation with mortgages so we could no longer afford to fight. I’ll give her her dues, she was a smart cookie who knew exactly what she was doing with that and it was nothing to do with peoples personal aspirations and home-owning dreams. Secondly, the populace has been fed a diet of whoppers with relish on top by the right wing media so widely and for so long that at least half the country have now swallowed it hook, line and sinker. If you repeat it often enough people will believe it.
Simon,
The Times estimate of BA ‘burn rate’ is simplistic to say the least. That roughly is what they spend a week in normal times. However half of that is employee costs and fuel. If they ain’t flying they aren’t buying fuel and until July a big slug of the employee costs are covered. Then there are operational handling costs and catering that are vastly reduced.
BA need to reduce headcount & fleet size as we aren’t getting back to normal in a hurry and they need to take action now, but the idea they will run out of cash in 12 weeks is a little fanciful.
Hi
Gary C ,
So you think due too the current climate and a Pandemic going on its ok too sack all your loyal long serving staff that has help you make the billions of profit over the years?
Not sure if you are aware they have over €6 billion in cash I have currently £600 and been in this company for 24 years?
They are using this as a excuse to change the company’s outgoings to suit there greedy pockets Gary ,have you never herd of the word immoral ? Look it up that’s what this and how this will benefit the government as we are uk tax payers and the uk economy?
Lastly I am not sure your aware but not many jobs out there at the moment Gary I just hope that you employer looks at this and then does the same too you! But by the sounds of it your probably the owner of your business and best mates with Walsh & Cruz for your free first class seat? Mmmm thought as much!
As for demanding by a trade union for furlough it was not a demand it was our legal rite to ask to be furloughed as by the uk government Gary we have all payed into the system! So why should we not be payed during this crisis? Income stream imagine well i am and I have never afforded to shop at Prada Gary and I may have to have food parcels going forward but job seekers allowance won’t even cover my council tax so as your so clever how will 25000 former employees be able to live and pay bills Gary? Hopefully the government put your tax up by 50% just you no one else who is a uk tax payer so that I am able to claim more benefits going forwards.
I understand your bitterness. So, try to explain to us what you would do if you were running BA, today and going forward in 2/3 years time.
You may need a crystal ball, but give it a go. I for one would be very interested to know.
Sorta lost us a bit there Bob…
I’m with Bob. BA making plenty of money up to now. IAG is scandalous. Iberia and Vueling take cash to maintain staff, while the BA uses the situation to dump staff on better contracts. I’d like to see IAG ended as a result of this. Either it’s a group or it’s not. BA contributed plenty to it’s profits and survival, yet now it’s staff takes all the downside.
I had a quick look on Companies House and in their last set of published accounts BA showed £1.327 billion in cash plus £1.175 billion in interest bearing deposits (not 6 billion). For quick reference the balance sheet is on page 26 and the related notes (21) to the accounts on page 57. With the vast majority of fleet grounded it won’t take long to ‘burn’ it. The Times estimates BA are burning about £200m a week so at this rate they have reserves to see themselves through about 12.5 weeks.
I really do feel for BA employees but to survive under current circumstances I don’t believe BA have an alternative option to downsizing their operations.
@Doug M. It’s good that we can all have a view and debate the BA issues, as long as it doesn’t get personal I feel.
I’d be interested to hear your views on the related question I asked Bob above…thanks.
There’s a conflict of interest here.
@Mikeact, it’s despair I’m ‘hearing’ in Bob’s comment and that’s a whole different level from bitterness. If Bob is a BA employee, you can magnify that despair up to 40,000 times, and then probably scale that up at least ×10 when considering the staff and other businesses (big and small) that are dependent on BA. I don’t dispute the need for BA, like the rest of the industry, to make adjustments but they do have choices in the way they go about it.
Thanks for that, but I guess, as just a customer, I’m not sure I know what their choices are as you say…which is what I’m trying to get my head around ?
From what I understand they have enough money for around 12 weeks or so and then that’s it ?
@Mikeact. How about you answer why Iberia and Vueling can take gov money to protect jobs but BA can’t? Regardless of how I or others might manage BA the only thing that matters is how it is being managed. IAG as a group is operating on one level in Spain protecting jobs and employees, and on another in the UK, acting like a scum employer using a major health crisis to dump its higher earners and those on better terms. Why can’t it use deferrals so that in better times the pay and conditions are brought back to previous levels.
If BA took out a £1 billion loan it would be able to tread water for an extra 5 weeks. Sorry to have to say this but it would just delay the inevitable. The Directors have a fiduciary duty to do the right thing for the business and taking out a loan like this if they can avoid it would be seen as the right course of action.
@Doug, from the IAG spectra, LEVEL and Vueling are the “chepest” employers. Followed by Iberia. Remember IB used the 2008 financial crisis to layoff `000s of jobs and cut wages across the board. They even created IB Express as a bargaining tool, until eventually the Gov had to intervene in IB-Unions negotiations.
Very,very well said @Doug M.
@Bob BA would have to downsize anyway. Theyve decided FiFO method of selection. We know why. Can you challenge this method of selection or say that it indirectly discriminates selection by age to make it illegal? Many, many companies would do LIFO.
BA has to let quite a lot of people go whatever they do. My issue is their true motive in choosing to use it to dump legacy decent contracts of longserving loyal staff. But secondarily they are not using money that is available to make this more decent than the legal minimum for the staff who will have to go. They are in a position to do this even in current circumstances which will have an end.
It’s the indecency of this when we know BA will survive. Turfing out longserving employees into the cold when there is nothing for them, when BA has access to resources to make that more decent and BA will survive and can recover but employees might not, this is disgusting.
More worrying is, why would anyone possibly stay employed in the UK long-term when the government is protecting UK employees less than, particularly, the Spanish.
@Simon fiduciary duty we all understand the numbers of staff that will have to lose their jobs.
But regardless of fiduciary duty there is the need for humanity and whatever kindness can be offered.
Otherwise if you’re blocking my way on the road I have every right to shoot you because I’m stronger than you and no need for me to politely ask you to move out of my way.
Bob – I understand the hurt and anguish at the current time. To address some of your points, whilst I’m probably successful in my field, I’m not a big business owner, nor do I move in the circles of people like Cruz. Regardless of what you might think, the position I take after a lot of consideration is one that I think will genuinely do the most good (or do the minimum harm) – and that includes balancing the needs of staff, shareholders and taxpayers. In the current environment it’s simply the lesser evil – there are no good options. Undoubtedly it will mean a bad outcome for some, and I’m sorry if you are one of the people affected. I will quite happily pay more tax when (inevitably) required to do my small part of help the country through this. And as soon as I’m able to fly again, I’ll be at T5 in my N95 mask and with my anti-viral wipes helping put some money back into BA’s coffers.
@Lady London. Completely agree with you. It has to be done as humanely and friendly as possible. The HR Director/Manager and their team at BA have everything to lose if they get it wrong.
A few years ago my wife contracted an auto-immune disease which ended up in the closure of her business as my businesses were already a crazy working week. We used an amazing HR consultant (we’ve used for over 10 years) and she was a star on the humanity and kindness side. Between her and us we’d arranged new employers for all of the staff in that business. Obviously this is nigh impossible for BA but they need to do it with compassion and humanity in mind.
Because they should prepare better so that they can survive a 100-year storm event, not just your average monsoon season.
BA is/was far better prepared than other competitors, but even with the cash and resources they have they cannot conceivably afford to keep everyone one while there is virtually no revenue coming in and little prospect of travel recovering to 2019 levels for several years. LH and AF/KLM entered this in a much weaker position and the US airlines had essentially no cash as it has all been spent on share buybacks in recent years.
It is obviously terrible for the staff but the directors also have strict legal duties to the shareholders to manage the business. They would be sued if they just kept staff on indefinitely with no work or insufficient work and staff make up a huge proportion of their costs.
BA is obviously a business that creates headlines, but no business that loses 90% of its turnover overnight through no fault of its own and has no visibility as to when that revenue might return to even 50% of previous levels can simply do nothing. It would also be totally contrary to the interests of the 2/3 of staff who will remain. In these situations the most expensive staff in terms of salaries, perks etc. (ie total employment costs) are always going to be the most vulnerable. One expensive departure may save two other jobs.
> the directors also have strict legal duties to the shareholders to
> manage the business.
It really is about time that company law in this country was amended so that both employees and customers were also owed equivalent strict legal duties.
Lufthansa are as ruthless as BA and also using this crisis to try and reduce staff benefits and pay. Fortunately for their employees it’ll be a bit harder because Germany has much stronger protections for employees. And better redundancy rights and compensation, and greater unemployment benefits. Meanwhile yes of course IAG will make bigger cuts at BA and Iberia staff will fare a lot better. I hope out of this crisis more people might ask why workers in the UK get such a bad deal, and stop voting for the party which has created this. I don’t envy anyone working in the UK who’s worried about their job or already lost it.
Not much point evaluating the relative merits of wonky carrots and bog-standard carrots when what was needed was Chantenay.
@Ralph “one expensive member of staff may save 2 other jobs”.
How about the literally hundreds of jobs that could be saved if the fatcat management packages got trimmed permanently too.
No one’s denying here about 12000 staff have a case to be let go. It’s which staff are being chosen and the fact that BA could make this more decent for those employees than they can get away with. Its a one off cost for BA to have some decency but for the employees it’s permanent.
@ Lady London – this idea of ‘fat cat’ management salaries at BA/IAG is just emotional twaddle. They have an incredibly lean management structure that has been slimmed down greatly over many years. The office based staff have taken a lot of the pain. I have nothing to do with IAG or any airline but I do look at these companies very closely.
Unfortunately, it is just the same principle as when people expect the rich to shoulder all the extra tax burden. They should, but the reality is that in this country only c. 10% of people pay higher rate tax (ie earn over c. £37,500 after personal allowance, so c. £50k) so that in order to raise meaningful sums, the tax burden will always fall on the majority. Increasing higher rate tax by say 20 percentage points raises remarkably little money – about the same as 2p on the basic rate. At BA, the vast majority of staff are pilots (relatively well paid, but a very highly skilled job with expensive and long training) or other customer facing staff who are much less well paid, but very numerous. Regrettably, they will have to take the pain.
Am I right in believing BA still separate non transferable crews at each airport as well?
I think that is the case which means if BA really does not return to LGW I think all staff who are based there are for the chop even if they transferred the flights to LHR.
Yes. The employer only has an obligation to consider offering a redundant employee a move to another site if that site is within IIRC 15 miles or so of the employee’s current site. So if Heathrow was that close to Gatwick an employee could claim any relevant job there. Unfortunately though, in n this case both sites have no no jobs vacant.
Lady London I was actually referring to the possibility that WW (Worldwide) or EF (Eurofleet) crew at LHR would assert their right to take the job on a flight now operating out of LHR that was previously operated from LGW by MF (Mixed Fleet) crew. This makes it difficult to make WW or EF crews at LHR redundant and then move LGW MF crew up to LHR. With redundancy you make the role redundant. I think this is more complicated than simply making the 12,000 cuts from as many WW or EF crew as possible. But I do also think they will try to make WW and EF crew move to the MF contract. It’s not a good time to be working for BA and I feel sorry for all affected.
One thing that is inevitable is that there will be the odd leaked e-mail from senior management that says something along the lines of “ use this as a great opportunity to get rid of older legacy staff”, which will be ideal evidence in the slew of unfair dismissal cases for age discrimination.
It’s very emotional isn’t it. And its going to become more emotional. Here we have Easyjet paying its largest individual shareholder his dividends ( I think 40 + Million ) in Monaco and then being offered and taking £600 million in loans. The most successful ( financially ) airline in Europe Whizz Air, not even a UK airline but registered on the UK Exchange taking £ 300 Million loan . I think at 0.4% interest. And Virgin being refused a loan because it has no ” marketable debt “. Ie its not a public company. But the backlash against Branso because he happens to live in the Caribbean has been enormous and the comments directed about him have been in many ways completely irrational.
Virgin Atlantic is a British company, paying taxes in the UK, employing UK crews who then pay taxes and is considered a great company to work for – ask any of the staff. yes they are ostracised publicly and castigated simply because Branson lives in the Virgin Islands. What about their staff? You could argue that Virgin have also been the one to keep BA in line to some degree on pricing. Then here we have BA using every tactic they can to utilise a public health crisis to re adjust their operating model. Can you blame them, well I think not. But they could deal with it in a more humanitarian way. However remembering that they are a public company who have public liabilities and shareholder liabilities that they can be challenged on. I think their staff can hopefully rely on their unions to defend their positions as strongly as possible and hopefully reach a decent settlement for those that do have to go. And there will be many.
I do think it is somewhat churlish to blame the current government for the position that these staff find themselves in. We have had a series of both labour and conservative administrations that have allowed the position to reach the current situation. Its also the current government who have allowed my own company to furlough but keep employed 30 + staff in the hope that we can restart the business as soon as possible. And it is we as directors who have made the decision to continue to pay the staff the balance from company reserves. If we were a public company rather than a private one then I am not sure we would have been able to do the same. I think the situation needs to have some balance.
This x 100%. Well said
You don’t need to be a public company to issue what you refer to as ‘’marketable debt’. However, if you issue public debt, you do need to issue a prospectus, file proper accounts/financial reports and you need a credit rating for the issuing entity. If you have these things in place as EasyJet and Wizz do, the Bank of England will, under the Covid provisions, buy that debt directly from you. Virgin Atlantic provides insufficient data so cannot use the various facilities on offer. It needs a ‘bespoke’ and the terms will also be bespoke. Essentially, the government has some confidence that some firms including Easy & Wizz will pay back these emergency loans. It would be totally wrong of the government to hand out large loans to companies that have no prospect of paying them back. Is that what you really want them to do with taxpayer money?
The question is: would Virgin Atlantic have got an investment grade credit rating on 1st March? This is the ONLY criteria for accessing the CCFF for those with debt in issue. I think that, if Virgin would have had tradeable debt, it WOULD have been investment grade on 1st March. This means that it could have accessed the facility.
Right, which only means they are not a fit business in the first place.
Like Northern Rock in ’08, the best case scenario is that VA officially goes into the administration and the Govt can maybe decide to nationalise it by taken over the all the private share at zero value (complicated since 49% share is owned by Delta). This ways some jobs maybe saved in the short term, but then eventually they’ll need to restructure to make it marketable to sell the business back to private sector. Govt only did this for Northern Rock in ’08 because the UK banking reputation is at risk. I really doubt the govt would do this for VA.
Official (and wild cat) strikes could quickly bring down Walsh and Cruz and they deserve nothing less. That would mean pilots, MF and euro/worldwide fleets taking united action. Pretty unlikely, this isn’t France but then a lot of people affected haven’t got a lot to loose given the alternative. It could even end up with BA being renationalised.
And then I imagine you would be very happy, wildcat strikes week in week out.
They tried that last year remember, when the pilots tried to hold BA to ransom. Didn’t work then did it?
Well, it possibly was worming but they j exlkicably folded after having inflicted a lot of damage on themselves…
They blinked first. The staff aren’t as ruthless as the management basically.
Or they accepted that they were actually on a pretty good deal anyway…and it was just seen as greed.
how effective are these strike going to be with 95% of flight grounded?
Well BA have 0% of a business without pilots and crew. If BA can’t even operate that 5% (which will gradually increase but who knows what by…) they’re in trouble.
You obviously won’t be happy without your wild cat strikes..
This has turned from a helpful factual site, to complete fantasy world. It is getting hard to sift out the crap and prejudice because there is so much of it.
One thing not lacking is the amount of armchair experts, it would be brilliant for the economy if their expertise and foresight could be channelled somehow LOL
I really despair at the kicking emplyees across all industries are going to get post Covid 19..
I suspect once this is all done and dusted, “Key Workers ” will revert back to being poorly paid “Expendibles”
Of course they will.
The clapping and saucepan banging is their reward – you didnt think the DM classes would countenance anything more than that did you?
BA gets a lot of heat for running a business like a business. It’s not a charity, it’s not government owned neither is it an NGO. From the moment covid-19 began to show its real impact, I was expecting job cuts to come fast and hot especially in the travel industry. A business has to do what is necessary to ensure their survival and heck to ensure they come out of the virus even stronger than they went in because that is the job of management. It doesn’t matter how much the airline made in the past, in this kind of crisis it is rather irrelevant because you’ll burn it much faster than you made it.
This virus is going to change this industry forever, it’s not 9/11, its not SARS. This is 10 times worse.
For BALPA to say they’re shocked is a bit naive I think. Not needing government aid does not equate to not making cuts. When has the industry ever experienced a thing like this? Blame the virus don’t blame the company for making hard but necessary decisions.
If you remove the emotion from this whole thing (which is not normal I know) what BA is doing is actually logical.
What would you have management tell the board? Sorry we are burning cash because I can’t sack my staff? well they’ll remove you and get someone who can.
Why isn’t Lufthansa getting heat for saying they’re looking to get rid of 10,000 jobs?
Another thing ppl don’t seem to understand is, expecting government to save all businesses isn’t right either. The fact that all this money is being printed/loaned, how do you all ‘wise’ (🙄) ppl think the government is going to ever balance the book?
Even if you don’t know Economics, it’s common sense. Do you want your kids and grandkids to spend their life paying the government high taxes or whatever scheme they will come up with to balance the books? How do you think it got so bad that food banks and homelessness and poverty increased? Haven’t y’all already been here before?
Most people are selfish in that yes, they are happy to let future generations pay for their own ease, now. They don’t like to admit it.
That’s how public sector pensions work. These pensions are generous – perhaps over-generous – but not funded now, like private sector pensions. Money comes from current year taxation. Ie all public sector pension payments will be a burden on future generations.
Nobody complains because it is unseemly to make nurses/ doctors/ teachers/ police/ ambulance drivers etc accept a more affordable pension like the rest of us & pay fair contributions *now* that make it a defined contribution scheme instead of a defined benefit scheme.
Agree @shoestringo. It’s pathetic. I have always alluded to my age because in honesty I was brought up to believe old ppl are wise but sure as hell doesn’t seem like it here.
It’s same with the climate change thing. Future generations will suffer for that too because of the selfishness of ppl now. I don’t want kids and I’m grateful every day that I won’t need to. Because why bring any kid into such a world 🌍
I was born at the start of the 1960s when the world population was 3 billion. Some (nearly – 57 in 2 days!) 60 years later it is heading for 8 billion by 2035 I think.
5 billion extra people on the planet in 60 years.
Astounding, yet nobody ever talks about it. Why? Is it unseemly to talk about population control in poorer countries? (Because that’s where the populations have exploded.)
5 billion extra people with all their polluting, cars, food needs etc – yet all politicians talk about is saving 5% here, 3% there on something largely irrelevant given the big picture?
You’re behind the times. This is a 1970’s mindset. Look at the data NOW. Only a handful of countries are still running at 5+ children per family.
Look at this for example for India – https://www.macrotrends.net/countries/IND/india/birth-rate During my lifetime is has dropped from 39 births per year per 1000 people to 17. This is lower than Morocco, Egypt etc. It continues to decline year on year.
Too late for me but I assure you the 3 billion world was a far nicer place to live in than the current 8 billion world.
It’s been part of the deal that public sector jobs – like the examples you reference are not particularly well remunerated but offer decent security and a solid pension. By ambulance driver I assume you mean paramedic, by any definition a key worker – their average salary is £27k, and you’re suggesting their current package and pension is overly generous? Really?
If you frame the question differently, then yes: I think all public sector pensions should be funded now, ie defined contribution schemes, and that employees should contribute more. The pensions could be as generous as now for all I care but both employee and employer should fund it properly now rather than leave that for future generations.
Key workers should be paid more. If you read all my comments you will understand what I mean @J
And @Shoestringo, humanity’s biggest flaw is they can’t take the truth.
Covid 19 is bad but tbh it hasn’t even killed enough ppl worldwide to wipe out a single day’s births. And, history shows that ppl have more kids when faced with uncertainty (despite having no logic to why they should) so I fear we might be heading to 8 billion way before 2035…
@opus I agree. In business there is no room for emotions. I know in an ideal world it would be nice that everyone could have good conditions/pay etc. But this isn’t that world.
And yes I have sympathy for ppl who are experiencing hardships but it’s happening everywhere. What makes one group of employees so special. Before anyone says about the employee loyalty (which everyone here has been going on about every day). Nobody told anyone to be loyal to a job.
Here lies the biggest truth, ppl can’t admit nor accept that where they wasted their loyalty and life, didn’t turn out to be the right decision.
It’s a bit like just imagine me having a go at ppl for not buying my books one month when money is tight. Well nobody forced me to become a writer. It was my own choice. So everyone should accept that you mk ur bed so lie in it.
It’s just logical and business, nothing personal.
And everyone here is just going on about it because we are basically stakeholders via points etc.
“In business there is no room for emotions. I know in an ideal world it would be nice that everyone could have good conditions/pay etc. But this isn’t that world”
For somebody apparently so young that seems a very confident blanket statement. There is the Walmart employment model you reference – lots of other very successful companies take a different approach. Fortunately previous generations mostly via trade unions decided to not just accept poor conditions and poor pay which is why we have paid holiday, weekends, employment contracts etc. Maybe when you’re not being a “writer” you might
read about it 🙂
Not in this industry let me tell you. This isn’t apple or google where you see operating margins of 20-25%. Any airline that pays their staff “well’ is government backed. the margins in this industry are extremely low, so one has to give. So I don’t know which other companies you’re talking about, because if they’re not an airline then its irrelevant.
When I was country mgr for a FTSE100 company for a few years, I simply had a stated policy of paying top decile, to recruit & retain the best people.
Easily understood by all, very fair and never questioned by the penny-pinching boss + bean-counter sidekick. Probably because the results were great, has to be said.
But they never let me start the team up on pension schemes, they said that was for them to decide and the pay was generous enough already.
Actually I have also stated I have studied business. I’m not a teenager. I always bang on about being young because it’s like an ironic statement because I can’t believe what some of people comment and as I already said in my naivety yrs ago I believed old people are wise.
I am confident in my statements because i am really well-read. I go with the facts and I’m a logical person.
@Novice: reading The Economist weekly plus reading (daily) the editorials from your choice of the quality newspapers would be my best advice for any student 18-25, not that you are any longer in that group.
Doing the difficult Telegraph crossword daily with your university pals over coffee also stretches the brain and was the single reason one of my Univ mates got recruited to the intelligence services.
@shoestringo, reading economist, FT was basically part of uni syllabus for me. I actually meant I’m well-read in a lot of different topics so may come across as too logical and worldly. I have interest in history, law and other stuff too. @J said I should read up so was just pointing that out.
Getting the company to pay for FT was one of my perks, great paper – though I no longer have a subscription, I used to read it cover to cover, daily, as an expat.
Because this is an English language blog and UK focused? Lots on Lufthansa in German media, Der Spiegel had a good piece (in German)
https://www.spiegel.de/wirtschaft/unternehmen/lufthansa-streit-um-staatshilfe-der-insolvenz-bluff-a-00000000-0002-0001-0000-000170716195
LH want free money from the government but don’t want to accept state involvement. They’re as much of a disgrace as BA.
Fair enough on that! I was speaking generally in the media not so much on this blog. But then again i live in the UK so i probably wouldn’t see much of it as you’ve pointed out anyway.
I still don’t know what makes BA a disgrace? they’re one of the most efficient run airlines in the world. and it shows in the numbers and their ability to withstand a heavy crisis like this. At least they are not asking for state bailout like LH? at least yet.
So BA is a disgrace because it’s sacking staff in the middle of a pandemic that’s causing it to burn tens of millions of pounds a day and zero revenue? sacking staff it will not need going into 2021 seeing as the 747s probably aren’t coming back.
Can someone tell me what they’d have BA rather do that will make economical sense
BA have made a unpopular but sound business decision. In the court of internet opinion they have committed a crime …
I 100% agree!
It’s certainly not written with an impartial view…which it should have been.
I’m very curious as to Rob’s personal view on this topic, which has understandably caused a lot of heated emotion. The headline suggests he believes that BA are being opportunistic, and using Covid-19 as an ‘excuse’ to make 12000 redundancies. But this seems hard to reconcile, for someone who’s made his own millions in private equity in the City 🙂
Rob is a stakeholder just like all of us. We’re all dishing out our opinions because we all something at stake eg. My future tax burden/ points…
I’m not saying what BA is doing doesn’t make financial sense.
On the other hand, I have not furloughed my own staff despite the fact that I would save many thousands of pounds per month by doing so.
No idea what his view is. But why should somebody’s previous work experience preclude them from taking an opinion on something else? I think it’s more constructive to focus on the current issue, rather than somebody’s past job? Someone can have a personal view and a separate professional working life. I say this as someone who used to work for a tobacco company which is perhaps the most extreme example.
Keuh keuh! 🙂